5 ms·
I was surprised share buybacks were not mentioned. Seems like every company has been doing this over the past few years. I'm no finance guru: is there a reaso
by snake_plissken 9y ago
I was surprised share buybacks were not mentioned. Seems like every company has been doing this over the past few years. I'm no finance guru: is there a reason buyback money couldn't be diverted into pay raises?
- nopriorarrests 9y agoPay raises lower the stock price. Buybacks raise it. CEO compensation depends on stock price. That's all.
- Pokepokalypse 9y ago. . . because stock is taxed differently than income. This is a huge incentive behind how our system has become so broken.
- 1123581321 9y agoNo, it's because a buyback is purchasing an asset (a share of issued stock) and payroll is just an expense. You could argue that increased payroll increases retention which is valuable, but that's an indirect and uncertain way to increase the value of a company.